XRP: Key Metric Shows 700,000,000 Drop

What to Know:

• XRP’s on-chain payment volumes have decreased significantly, signaling potential shifts in network activity and investor sentiment.
• Technical indicators suggest XRP is trading below key resistance levels, with bearish sentiment prevailing in the short term.
• Investors should monitor critical support levels and potential breakout points to gauge XRP’s near-term price action and recovery prospects.

XRP has experienced a notable decline in on-chain activity, particularly a sharp drop in payment volume, raising questions about network utility and investor confidence. Data reveals a significant decrease in XRP transfers, falling from 700 million daily transactions to around 230 million by the end of the month. This shift prompts analysis of both short-term market dynamics and the broader health of Ripple’s ecosystem.

The decrease in payment volume could reflect a temporary slowdown in remittance or institutional activity, or potentially a broader decline in organic usage. Historically, XRP’s on-chain metrics have weakened during periods of price stagnation, and the present scenario appears consistent with this trend. Monitoring these metrics is crucial for understanding the underlying demand and utility of the XRP network.

From a technical standpoint, XRP is currently trading around $2.49, hovering just above short-term support while remaining below key resistance levels defined by the 100-day and 200-day moving averages at $2.78 and $2.81, respectively. The Relative Strength Index (RSI) at 45 suggests weak momentum, leaning slightly towards bearish territory, indicating caution among traders. Successfully navigating these technical hurdles will be critical for any potential price recovery.

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The prevailing bearish sentiment is evident as XRP recently failed to sustain a breakout from a descending wedge pattern. The $2.40-$2.35 range remains a crucial short-term support level, and a failure to hold this could lead to further corrections, potentially down to $2.10. Conversely, reclaiming the $2.80 mark with a confirmed breakout would signal a recovery and a resurgence in network demand.

In conclusion, the current on-chain data and technical indicators suggest a cautious outlook for XRP in the near term. Investors should closely watch key support and resistance levels, as well as any signs of renewed network activity, to better assess the potential for consolidation or recovery. Monitoring regulatory developments and broader market trends will also provide valuable context for navigating the evolving crypto landscape.

Related: XRP Price: $12M Max Pain for Bears

Source: Original article